849: SaaS: Kinvey Acquired for $50m To Help Frontend Devs Be Backend Devs

SaaS Interviews with CEOs, Startups, Founders

Nathan Latka

Ceo, Entrepreneurs, Founders, Software, Business, Entrepreneurship, Saas, Startups

4.6 • 683 Ratings

🗓️ 20 November 2017

⏱️ 26 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

Sravish Sridhar. He’s the VP and General Manager at Kinvey Progress and was previously the CEO and founder of Kinvey before it was acquired by Progress. He’s also an angel investor in multiple startups with successful exits.

Famous Five:

Favorite Book? – Crossing the Chasm
What CEO do you follow? – Matt Barbey
Favorite online tool? — If This Then That
How many hours of sleep do you get?— 7
If you could let your 20-year old self, know one thing, what would it be? – “I would never become a movie actor”

Time Stamped Show Notes:

01:50 – Nathan introduces Sravish to the show
02:18 – Kinvey’s acquisition closed on June 1st and was announced on June 28th
02:30 – Kinvey does “backend as a service”, which is a term that they coined
02:58 – Schneider Electric has a lot of apps that are used to interact with its hardware, employees and customers
- 03:13 – Kinvey is in charge of the backend features that an app needs
03:44 – “We make every frontend developer become a backend developer”
- 03:55 – Developers don’t have to learn the backend processes, they can simply drag and drop
04:07 – Kinvey has three types of customers:
- 04:10 – First, those who are building apps as a hobby or trial and pay nothing up to $200 a month
- 04:22 – Second, business edition customers who pay an average of $24K a year per application
- 04:44 – Lastly, enterprise edition customers who pay around 6 figures a year
- 05:03 – ACV is around $80K to $90K
05:24 – When Sravish came up with the idea for Kinvey, he knew it should be a venture-backed company
- 05:46 – Sravish funded the initial capital of $150K
- 06:06 – Kinvey has raised over $15M before the acquisition
06:30 – It took Kinvey 15 month to launch their product
- 06:43 – In the second year, they started to build their revenue
- 07:10 – In 2013, they were doing high 6-figures in revenue
- 07:24 – They broke their million dollar mark in 2014
07:54 – Sravish invested in startups to learn strategies and build his financial portfolio
09:20 – Sravish has three things he looks for when investing in a startup:
- 09:22 – The team’s relationship with each other
- 09:39 – The space of the startup
- 09:55 – The potential he has to help the startup to grow
10:40 – Kinvey has over 50 enterprise customers
12:54 – The acquisition of Kinvey by Progress was for $50M
13:13 – Sravish shares how the board and himself decided on the acquisition
14:40 – Sravish’s discussion with Progress
15:43 – Team size prior to acquisition was 44 and everyone stayed after the acquisition, current team size is 65-70
16:00 – Kinvey had multiple offers and it took them 2-3 months to decide
16:40 – Progress matched the best offer
17:00 – Kinvey and Progress are both based in Boston
17:58 – Kinvey had direct sales models and enterprise sales reps
18:10 – CAC is $95K to $100K and LTV is $2.1-2.2M
18:33 – Payback period is 13-14 months
19:04 – Kinvey has 98% retention rate
20:40 – Progress has been thoughtful with their employees’ restricted stock units (RSU)
23:40 – The Famous Five

3 Key Points:

Choose the deal that will be a great fit for the long-term.
Always consider the company and, most importantly, your team’s future when making decisions.
Investing isn’t just about the financial gains, it’s about your ability to believe in and help a company grow and succeed.

Resources Mentioned:

Simplero – The easiest way to launch your own membership course like the big influencers do but at 1/10th the cost.
The Top Inbox – The site Nathan uses to schedule emails to be sent later, set reminders in inbox, track opens, and follow-up with email sequences
GetLatka - Database of all B2B SaaS companies who have been on my show including their revenue, CAC, churn, ARPU and more
Klipfolio – Track your business performance across all departments for FREE
Hotjar – Nathan uses Hotjar to track what you’re doing on this site. He gets a video of each user visit like where they clicked and scrolled to make the site a better experience
Acuity Scheduling – Nathan uses Acuity to schedule his podcast interviews and appointments
Host Gator– The site Nathan uses to buy his domain names and hosting for the cheapest price possible
Audible– Nathan uses Audible when he’s driving from Austin to San Antonio (1.5-hour drive) to listen to audio books
Show Notes provided by Mallard Creatives

Transcript

Click on a timestamp to play from that location

0:00.0	launched back in 2011 group about 44 people about 50 paying customers with annual selling prices
0:05.9	are around you know 70 80 90 100 thousand enterprise higher small business obviously lower
0:11.7	doing well over for you know 4.5 million bucks in month occurring revenue sold for sorry an annual
0:17.4	occurring revenue sold for around 50 million bucks recently about two three months months ago, now working to continue growing, really backend as a service.
0:25.0	It's really unique to almost drag and drop, making front engine engineers, back end engineers without having to go through all the extra training and understanding all, you know, how the individual lens of code are written with the new company progress.
0:36.1	This is the top where I interview entrepreneurs who are number one or number two in their
0:41.8	industry in terms of revenue or customer base.
0:45.4	You'll learn how much revenue they're making, what their marketing funnel looks like,
0:49.1	and how many customers they have.
0:52.0	I'm now at $20,000 per top. Five and six million. He is hell bent on
0:56.1	global domination. We just broke our 100,000 unit sold mark. And I'm your host, Nathan Latka.
1:03.2	Many of you listening right now don't have time to listen to every B2B SaaS CEO that I've
1:07.7	interviewed. If you want to get access to the database I've created with year-over-year growth rates, customer accounts, margins, and many, many other data metrics and data
1:15.5	points, you can go to g-et-l-a-com. Here's the thing, though, this database, I keep it to myself.
1:22.8	It's so freaking valuable. And to preserve the quality of the data and make sure that the people that
1:27.8	have access to it have a true advantage, I'm only letting 10 companies on each month. So we're full
1:33.0	this month, but you can go to gitlatka.com to get on the waiting list for next month. And look,
1:37.2	there's big people on the waiting list. I mean, the biggest VCs you've ever heard of, you've
1:40.9	probably heard of them. They're big, private equity, billions and billions under management. So it's an impressive waiting list. Go get on now at gitlatka.com. Hello, everybody. My
1:49.5	guest today is Shrewis Shredar. He is the VP in general manager at a company called Kinvey Progress,
1:55.5	which was previously, and it was previously the CEO and founder of Kinvey before was acquired
2:00.2	by the company.
	...

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